WesBanco Announces First Quarter 2025 Financial Results

Successful acquisition of Premier Financial combined with strong organic loan and deposit growth

WHEELING, W.Va., April 29, 2025 /PRNewswire/ -- WesBanco, Inc. ("WesBanco" or "Company") (Nasdaq: WSBC), a diversified, multi-state bank holding company, today announced net income and related earnings per share for the three months ended March 31, 2025, which included the closing of the previously announced Premier Financial Corp. ("PFC") acquisition. WesBanco reported a net loss available to common shareholders for the first quarter of 2025 of $11.5 million, or $(0.15) per share, which reflected the impact of a day one provision for credit losses and other expenses related to the acquisition, as compared to net income of $33.2 million, or $0.56 per share, for the first quarter of 2024. As noted in the following table, net income available to common shareholders, excluding after-tax day one provision for credit losses on acquired loans and restructuring and merger-related expenses, for the three months ended March 31, 2025 was $51.2 million, or $0.66 per share, as compared to $33.2 million, or $0.56 per share, in the prior year period (non-GAAP measures).

Under the Current Expected Credit Loss ("CECL") accounting standard, which ensures a forward-looking approach to credit risk, WesBanco was required to estimate and record expected credit losses over the life of the acquired PFC loans. At March 31, 2025, we recorded an allowance for credit losses of $88.5 million and a $59.4 million provision for the acquired loan portfolio. This required day one provision for credit losses on acquired loans is considered a non-recurring earnings impact as it is associated with the closing of the PFC acquisition and not indicative of operational or credit quality trends. The first quarter provision for credit losses was $68.9 million and the allowance for credit losses was $233.6 million at March 31^st, which provided a coverage ratio of 1.25%, as compared to 1.10% as of December 31, 2024. Excluded from the allowance for credit losses and related coverage ratio are fair market value adjustments on previously acquired loans representing 1.88% of total portfolio loans.

Financial and operational highlights during the quarter ended March 31, 2025:

• Successfully closed the acquisition of PFC, on February 28^th, creating a regional financial services institution with $27.4 billion in assets, significant economies of scale, and strong pro forma profitability metrics
• Total organic loan growth was 7.8% year-over-year and 4.4% over the sequential quarter, annualized, and fully funded through deposit growth
  • Reflecting $5.9 billion of loans from PFC and organic growth, total loans increased 57.3% year-over-year to $18.7 billion
• Total organic deposit growth was 6.8% year-over-year and 8.1% over the sequential quarter, annualized
  • Organic deposit growth, excluding certificates of deposit, increased 4.8% year-over-year and 10.6% over the sequential quarter, annualized
  • Reflecting $6.9 billion of deposits from PFC and organic growth, total deposits increased 57.8% year-over-year to $21.3 billion
  • Average loans to average deposits were 89.3%, providing continued capacity to fund loan growth
• Net interest margin of 3.35% increased 32 basis points sequentially, as PFC benefited the margin by approximately 25 basis points through interest mark accretion and securities restructuring
• Reflecting the PFC acquisition and organic growth, Trust and Investment Services ("WTIS") assets under management increased to a record $7.0 billion and broker-dealer securities account values (including annuities) increased to a record $2.4 billion
• Efficiency ratio of 58.6% improved 803 basis points year-over-year and 261 basis points sequentially due to the benefits of the PFC acquisition, as well as a continued focus on expense management and driving positive operating leverage
• Key credit quality metrics continued to remain at low levels and favorable to peer bank averages (based upon the prior four quarters for banks with total assets between $20 billion and $50 billion)

"Our first quarter results demonstrate continued solid operational performance, as we again delivered strong organic loan and deposit growth while driving positive operating leverage. We also continued to strengthen our balance sheet and net interest margin by funding loan growth with deposits and reducing higher-cost borrowings," said Jeff Jackson, President and Chief Executive Officer, WesBanco. "This quarter also marked a significant milestone for WesBanco as we successfully completed our acquisition of Premier Financial Corp., a merger that expands and strengthens our market position and accelerates our long-term growth strategy. We are pleased to welcome Premier's talented team, loyal customers and strong community partners to WesBanco. As we move forward together, our teams are focused on executing a seamless integration and delivering on the full potential of the combined organization for all our stakeholders."

Balance Sheet
WesBanco's balance sheet, as of March 31, 2025, reflects both the PFC acquisition and organic growth. Total assets increased 54.2% year-over-year to $27.4 billion, including total portfolio loans of $18.7 billion and total securities of $4.3 billion. Total portfolio loans increased 57.3% year-over-year due to acquired PFC loans of $5.9 billion and organic growth of $0.9 billion, with $0.8 billion from the commercial teams. Commercial real estate payoffs totaled approximately $83 million during the first quarter of 2025. Securities, which represented 15.8% of total assets, increased $1 billion year-over-year due to the addition of PFC securities. In addition, approximately $775 million of lower coupon or variable rate PFC securities were sold and replaced with approximately $475 million of longer-term, higher coupon fixed rate securities.

Deposits of $21.3 billion increased 57.8% year-over-year due to acquired PFC deposits of $6.9 billion and organic growth. Total organic deposit growth was $922 million, or 6.8%, year-over-year and $285 million quarter-over-quarter which fully funded loan growth of $921 million and $138 million, respectively. Reflecting the addition of PFC deposits, which included $1.3 billion of certificates of deposit, total demand deposits represented 49% of total deposits, with the non-interest bearing component representing 25%.

Federal Home Loan Bank ("FHLB") borrowings totaled $1.5 billion, of which approximately 93% have 2025 maturities, increased $476.5 million, or 47.7%, from December 31, 2024, due to the addition of borrowings from PFC.

Credit Quality
As of March 31, 2025, total loans past due, criticized and classified loans, non-performing loans, and non-performing assets as percentages of the loan portfolio and total assets have remained low, from a historical perspective, and within a consistent range through the last five years. Total loans past due as a percent of the loan portfolio decreased 4 basis points quarter-over-quarter to 0.43%, while non-performing assets as a percentage of total assets increased 8 basis points to 0.30%.

Net Interest Margin and Income
The first quarter margin of 3.35% improved 32 basis points compared to the fourth quarter and 43 basis points on a year-over-year basis, through a combination of higher loan and securities yields, lower funding costs, and higher purchase accounting accretion. Despite higher-cost certificates of deposit from PFC, deposit funding costs of 255 basis points for the first quarter of 2025 decreased as compared to 271 basis points in the fourth quarter of 2024 and 256 basis points in the prior year period. When including non-interest bearing deposits, deposit funding costs for the first quarter were 188 basis points. Interest rate mark accretion from the PFC acquisition, in addition to the securities restructuring, benefited the first quarter net interest margin by approximately 25 basis points.

Net interest income for the first quarter of 2025 was $158.5 million, an increase of $44.6 million, or 39.1% year-over-year, reflecting the impact of a larger balance sheet from the PFC acquisition, loan growth, higher loan and securities yields, lower FHLB borrowings, and $9.1 million of purchase accounting accretion from acquisitions.

Non-Interest Income
For the first quarter of 2025, non-interest income of $34.7 million increased $4.0 million, or 13.2%, from the first quarter of 2024 due primarily to the acquisition of PFC which drove higher service charges on deposits, bank-owned life insurance ("BOLI"), digital banking income, and trust fees. Service charges on deposits increased $1.8 million year-over-year, reflecting the addition of PFC, fee income from new products and services and treasury management, and increased general consumer spending. BOLI increased $1.4 million year-over-year due to a $0.9 million death benefit received and the addition of PFC. Gross swap fees were $2.0 million in the first quarter, compared to $0.8 million in the prior year period, while fair value adjustments were a loss of $1.0 million compared to a gain of $0.8 million, respectively.

Non-Interest Expense
Reflecting the closing of the PFC acquisition on February 28^th, non-interest expense, excluding restructuring and merger-related costs, for the three months ended March 31, 2025 was $114.0 million, a $16.8 million, or 17.2%, increase year-over-year primarily due to the addition of the PFC expense base associated with approximately 900 employees and 70 financial centers. Equipment and software expense of $13.1 million, includes the additional cost of operating two core systems until conversion to one platform in mid-May. Amortization of intangible assets of $4.2 million increased $2.1 million year-over-year due to the core deposit intangible asset that was created from the acquisition of PFC.

Capital
WesBanco continues to maintain what we believe are strong regulatory capital ratios, as both consolidated and bank-level regulatory capital ratios are well above the applicable "well-capitalized" standards promulgated by bank regulators and the BASEL III capital standards. In conjunction with the February 28^th closing of the PFC acquisition, WesBanco issued 28.7 million shares of common stock to acquire the outstanding shares of PFC, which increased total capital by $1.0 billion and, as anticipated, modestly impacted capital ratios. At March 31, 2025, Tier I leverage was 11.01%, Tier I risk-based capital ratio was 10.69%, common equity Tier 1 capital ratio ("CET 1") was 9.99%, and total risk-based capital was 13.59%. In addition, the tangible common equity to tangible assets ratio was 7.47% due to strong earnings and the third quarter common equity raise.

Conference Call and Webcast
WesBanco will host a conference call to discuss the Company's financial results for the first quarter of 2025 at 9:00 a.m. ET on Wednesday, April 30, 2025. Interested parties can access the live webcast of the conference call through the Investor Relations section of the Company's website, www.wesbanco.com. Participants can also listen to the conference call by dialing 888-347-6607, 855-669-9657 for Canadian callers, or 1-412-902-4290 for international callers, and asking to be joined into the WesBanco call. Please log in or dial in at least 10 minutes prior to the start time to ensure a connection.

A replay of the conference call will be available by dialing 877-344-7529, 855-669-9658 for Canadian callers, or 1-412-317-0088 for international callers, and providing the access code of 1119838. The replay will begin at approximately 12:00 p.m. ET on April 30, 2025 and end at 12 a.m. ET on May 14, 2025. An archive of the webcast will be available for one year on the Investor Relations section of the Company's website (www.wesbanco.com).

Forward-Looking Statements
Forward-looking statements in this report relating to WesBanco's plans, strategies, objectives, expectations, intentions and adequacy of resources, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The information contained in this report should be read in conjunction with WesBanco's Form 10-K for the year ended December 31, 2024 and documents subsequently filed by WesBanco with the Securities and Exchange Commission ("SEC"), which are available at the SEC's website, www.sec.gov or at WesBanco's website, www.WesBanco.com. Investors are cautioned that forward-looking statements, which are not historical fact, involve risks and uncertainties, including those detailed in WesBanco's most recent Annual Report on Form 10-K filed with the SEC under "Risk Factors" in Part I, Item 1A. Such statements are subject to important factors that could cause actual results to differ materially from those contemplated by such statements, including, without limitation, that the businesses of WesBanco and Premier may not be integrated successfully or such integration may take longer to accomplish than expected; the expected cost savings and any revenue synergies from the merger of WesBanco and Premier may not be fully realized within the expected timeframes; disruption from the merger of WesBanco and Premier may make it more difficult to maintain relationships with clients, associates, or suppliers; the effects of changing regional and national economic conditions, changes in interest rates, spreads on earning assets and interest-bearing liabilities, and associated interest rate sensitivity; sources of liquidity available to WesBanco and its related subsidiary operations; potential future credit losses and the credit risk of commercial, real estate, and consumer loan customers and their borrowing activities; actions of the Federal Reserve Board, the Federal Deposit Insurance Corporation, the Consumer Financial Protection Bureau, the SEC, the Financial Institution Regulatory Authority, the Municipal Securities Rulemaking Board, the Securities Investors Protection Corporation, and other regulatory bodies; potential legislative and federal and state regulatory actions and reform, including, without limitation, the impact of the implementation of the Dodd-Frank Act; adverse decisions of federal and state courts; fraud, scams and schemes of third parties; cyber-security breaches; competitive conditions in the financial services industry; rapidly changing technology affecting financial services; marketability of debt instruments and corresponding impact on fair value adjustments; and/or other external developments materially impacting WesBanco's operational and financial performance. WesBanco does not assume any duty to update forward-looking statements.

While forward-looking statements reflect our good-faith beliefs, they are not guarantees of future performance. All forward-looking statements are necessarily only estimates of future results. Accordingly, actual results may differ materially from those expressed in or contemplated by the particular forward-looking statement, and, therefore, you are cautioned not to place undue reliance on such statements. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events or circumstances, except as required by applicable law.

Statements in this presentation with respect to the benefits of the merger between WesBanco and Premier, the parties' plans, obligations, expectations, and intentions, and the statements with respect to accretion, earn back of tangible book value, tangible book value dilution and internal rate of return, constitute forward-looking statements as defined by federal securities laws. Such statements are subject to numerous assumptions, risks, and uncertainties. Actual results could differ materially from those contained or implied by such statements for a variety of factors including: the businesses of WesBanco and Premier may not be integrated successfully or such integration may take longer to accomplish than expected; the expected cost savings and any revenue synergies from the merger may not be fully realized within the expected time frames; disruption from the merger may make it more difficult to maintain relationships with clients, associates, or suppliers; changes in economic conditions; movements in interest rates; competitive pressures on product pricing and services; success and timing of other business strategies; the nature, extent, and timing of governmental actions and reforms; extended disruption of vital infrastructure; and other factors described in WesBanco's 2024 Annual Report on Form 10-K and documents subsequently filed by WesBanco with the Securities and Exchange Commission.

Non-GAAP Financial Measures
In addition to the results of operations presented in accordance with Generally Accepted Accounting Principles (GAAP), WesBanco's management uses, and this presentation contains or references, certain non-GAAP financial measures, such as pre-tax pre-provision income, tangible common equity/tangible assets; net income excluding after-tax restructuring and merger-related expenses and excluding after-tax day one provision for credit losses on acquired loans; efficiency ratio; return on average assets; and return on average tangible equity. WesBanco believes these financial measures provide information useful to investors in understanding our operational performance and business and performance trends which facilitate comparisons with the performance of others in the financial services industry. Although WesBanco believes that these non-GAAP financial measures enhance investors' understanding of WesBanco's business and performance, these non-GAAP financial measures should not be considered an alternative to GAAP. The non-GAAP financial measures contained therein should be read in conjunction with the audited financial statements and analysis as presented in the Annual Report on Form 10-K as well as the unaudited financial statements and analyses as presented in the Quarterly Reports on Forms 10-Q for WesBanco and its subsidiaries, as well as other filings that the company has made with the SEC.

About WesBanco, Inc.
With over 150 years as a community-focused, regional financial services partner, WesBanco Inc. (NASDAQ: WSBC) and its subsidiaries build lasting prosperity through relationships and solutions that empower our customers for success in their financial journeys. Customers across our eight-state footprint choose WesBanco for the comprehensive range and personalized delivery of our retail and commercial banking solutions, as well as trust, brokerage, wealth management and insurance services, all designed to advance their financial goals. Through the strength of our teams, we leverage large bank capabilities and local focus to help make every community we serve a better place for people and businesses to thrive. Headquartered in Wheeling, West Virginia, WesBanco has $27.4 billion in total assets, with our Trust and Investment Services holding $7.0 billion of assets under management and securities account values (including annuities) of $2.4 billion through our broker/dealer, as of March 31, 2025. Learn more at www.wesbanco.com and follow @WesBanco on Facebook, LinkedIn and Instagram.